In this episode we talk about how Amazon is lagging behind in India, Reliance Retail’s annual results, fake e-commerce stores getting busted and the pricing disputes between offline and online smartphone retailers.
Summary of Week 35 of 2022 :
How Amazon is lagging behind on several key metrics in India This week, an earth shattering report from the US-based investment firm Sanford C. Bernstein describes how Amazon is lagging behind in India in multiple ways.
Amazon India’s 2021 GMV stood at <$ 20B vs Walmart-owned Flipkart’s $23B
India is one of the key markets, however, Amazon is facing stiff competition from regional players like Softbank-backed Meesho, Tiger Global-backed DealShare, Reliance Retail and Tata’s e-commerce suite.
The attempt to acquire India’s second largest retail chain - Future Retail ended in a long legal pursuit with Reliance Retail and the government bodies.
Amazon struggled to scale volumes in high margin categories like fashion and beauty.
The limitations of operating inventory led model also led to limited private labels vs competition, further suppressing margins
The company faced significant management employee attrition, alarming bells towards limitations in achieving the desired results
Regulatory restrictions in India urged foreign-owned e-commerce marketplace operators to limit controlling stakes of their own brands to 25%, hence Amazon’s Indian seller entities Cloudtail and Appario to 24%. This restriction of inventory ownership models has also reduced discounts.
Earlier, Amazon operated with some exclusive brands like Oneplus, the govt regulation also eliminated this exclusivity buzz
Amazon Prime membership has almost 30x less options in India for half-day delivery vs the US
Even during the festive season, Amazon managed to capture only 27% share vs 62% of Flipkart
Reliance Retail’s annual results and growth plans
During the AGM of Reliance Industries Limited this week, billionaire Mukesh Ambani announced that the retail arm is growing consistently, going beyond $100B mark.
The eCommerce platform Ajio is driven by 80% of repeat customers
Last year Reliance sold 430M garments, enough to cover the entire population of US and Canada
The group is focused on bringing more luxury brands to the Indian market
How fake e-commerce store operators got busted in Delhi
A special cell of Delhi Police has solved a critical case of cyber fraud for the eCommerce sites aggarwalandsons.co.in, hindsolution.co.in, bansaltraders.com, sunsolar.com and many more created by a group of alleged cyber criminals.
The sites used to display the products of popular home appliances and electronics brands at cheap rates
As per the police, the group used to utilise SEO techniques to lure audience to their website and never deliver the items to the customers
If anyone in India has faced such an issue they can call on 1930 to report cyber crime or register a complaint at cybercrime.gov.in
Offline smartphone retailers express concerns over the online pricings
Organised Retailers Association is a body of 18 electronics retailer chain brands like Sangeetha, Poorvika, Big C and more. They are pressurising the online retail brands that if they do not curtail the deep discounting practice then they will boycott the entire sales as it hurts the whole market.
All India Mobile Retailers Association - a body representing 120K retailers has also sent letters to all major smartphone brands warning the same.
Also in India, the brands launched multiple models of a similarly speced smartphones with different pricing on online channels and offline retail channels, that is being requested to be changed.
That’s a quick wrap for this week. You can also view and share the transcript blog of this episode at the link given in the description. If you’re interested in being on our podcast to share your retail experience or reflect on the new developments, you can tweet or DM me over Twitter at @geekprateek . Keep listening to us and do share with your peers in the retail ecosystem.
See you in the next one.
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